All India Services (Conditions of
Service-Residuary matters) Rules, 1960, whether offends Article 14 of
Constitution, as conferring arbitrary and uncanalised power upon the Central
Government to grant relaxation whenever it pleased to do so.

Power to Review its earlier orders by the
Central Government when such a power of review is not expressly conferred by
the rules.

HEADNOTE:

One Sri Ahluwalia a senior member of the
Indian Police Service sought to quash the decision of the Union of India dated
26-6-1976 whereby his year of allotment was fixed as 1965. When the Writ
Petition of Sri Ahluwalia was pending in the High Court of Himachal Pradesh,
some of the respondents in that Writ Petition and one R. R. Verma-all direct
recruits, choose to file a Writ Petition in the Delhi High Court questioning
the notice dated June 29, 1973 calling upon them to submit representations
against the year of allotment proposed to be allotted to M/s. Sahney, Dhaliwal
and Ahluwalia. After the Writ Petition of Ahluwalia was allowed, and after the
Central Government passed the order dated July 27, 1979, pursuant to the
direction issued by the High Court of Himachal Pradesh to Union of India to
refix the seniority and year of allotment to Sri Ahluwalia, the Delhi High
Court dismissed the Writ Petition filed by the direct recruits as infructuous.
The High Court, however granted a certificate of fitness to appeal to this Court
under Article 133 of the Constitution.

Dismissing the appeal, the Court

HELD: 1. The Writ Petition having been
dismissed as infructuous it is not proper on the part of the High Court to
grant a certificate of fitness under Article 133 of the Constitution. [480G-H]

2. Rule 3 of the All India Services
(Conditions of Service-residuary matters) Rules, 1960 is couched in a language
suggestive of near-autocratic power reminiscent of "bad old days" of
the Imperial Raj but, the rule is not ment to vest the Central Government with
power to pass any order they like with a view to promote the interests of a
favoured Civil servant. It is really meant to relax. In appropriate cases, the
relentless rigour of a mechanical application of the rules, so that civil servants
may not be subjected to undue and undeserved hardship. Sufficient guidance can
be had from the very rule and from the scheme of the various statutory
provisions dealing with the conditions of service of Members of the All India
Service. [481G-H, 482A-B]

3. Rule 3 is not unconstitutional on the
ground that it vests an unfettered discretion in the Government. Section 3 of
the All India Services Act enables 479 the Central Government in consultation
with the Governments of the States concerned to make rules for the regulation
of recruitment, and the conditions of service of persons appointed to an All
India Service. Pursuant to the power given by Section 3 of the All India
Services Act the Central Government has made innumerable sets of rules, some common
to all the All India Services and some applicable separately to each of the All
India Services. The All India Services (Leave) Rules, the All India Services
(Conduct) Rules, the All India Services (Discipline and Appeal) Rules, the all
India Services (Travelling Allowance) Rules, and the All India Services
(Conditions of Service-residuary matters) Rules are examples of rules made
under Section 3 of the All India Services Act which are common to all the All
India Services. The Indian Police Service (Cadre) Rules, the Indian Police
Service (Recruitment) Rules, the Indian Police Service (Probation) Rules, the
Indian Police Service (Regulation of Seniority) Rules are examples of rules
made under section 3 of the All India Services Act applicable to a single All
India Service, namely, the Indian Police Service. The rules deal with countless
matters which concern a civil servant, such as creation of cadre, fixation of
Cadre Strength, recruitment, seniority, promotion, leave, allowances, conduct,
discipline and appeal, and a host of such other matters. The golden thread,
which runs through the entire complex fabric or rules is the securing of honest
and competent civil servants. Integrity and efficiency are the hall marks of
any Civil service anywhere and they are what are contemplated and aimed at by
the wide range of rules. The interest to be served is always the public
interest and not individual interest. Public interest, in the matter of the
conditions of service of civil servants, is best served by rules which are
directed towards efficiency and integrity. [482B-G & 483D] Now very wide as
the range covered by the rules is, the rules can never be exhaustive.
Unforeseen and complex situations often arise. Very often it is found that all
too strict application of a rule works undue hardship on a civil servant.
resulting in injustice and inequity, causing disappointment and frustration to
the civil servant and finally leading to the defeat of the very objects aimed
at by the rules namely efficiency and integrity of civil servants. Hence it is
that the Central Government is vested with a reserve power under rule 3 to deal
with unforeseen and unpredictable situations, and to relieve the civil servants
from the infliction of undue hardship and to do justice and equity. It does not
mean that the Central Government is free to do what they like, regardless of
right or wrong; nor does it mean that the Courts are powerless to correct them.
The Central Government is bound to exercise the power in the public interest
with a view to secure civil servants of efficiency and integrity, and when and
only when undue hardship is caused by the application of the rules, the power
to relax is to be exercised in a just and equitable manner but, again, only to
the extent necessary for so dealing with the case Moreover, the exercise of the
power of relaxation like all other administrative action affecting rights of
parties is subject to judicial review on grounds now well known. [482G-H,
483A-C]

4. It is not correct to say that the principle
that the power to review must be conferred by statute either specifically or by
necessary implication is applicable to decisions purely of an administrative
nature. To extend the principle to pure administrative decisions would indeed
lead to untoward and startling results. Surely, any Government must be free to
alter its policy or its decision in administrative matters. If they are to
carry on their daily administration they cannot be hide-bound by the rules and
restrictions of judicial procedure though of course they are bound to obey all
statutory requirements and also observe the principles of natural justice where
rights of parties may be affected.

Again, if administrative decisions are
reviewed, the decisions taken after review are subject to judicial review on
all grounds on which an administrative decision may be questioned in a Court.
[483F-H, 484A] Patel Narshi Thakershi and Ors. v. Pradvamunsinghji
Arjunsinghji, AIR 1970 SC 1273; D. N. Roy and S. K. Banerjee and Ors. v. State
of Bihar and Ors., [1971] 2 S.C.R. 522 and State of Assam and Anr. v. J. N. Roy
Biswas [1976] 2 S.C.R.

128, distinguished.

CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 2686 of 1979.

From the Judgment and order dated 27-8-1979
of the Delhi High Court in Civil Writ Petition No. 844/78.

R.K. Garg and C. M. Nair for the Appellant.

H.S. Marwah for the Respondent No. 6.

V.M. Tarkunde and P. P. Juneja for Respondent
No. 7.

Lal Narain Sinha Att. Genl., Abdul Khader and
Miss A.

Subhashini for the Union of India.

The Judgment of the Court was delivered by
CHINNAPPA REDDY, J.-The judgment in this appeal is really an appendix to the
judgment pronounced by us in Civil Appeal No. 2112 of 1979. The relevant facts
may be gathered from that judgment. The further events requiring to be
mentioned are these: While the Writ Petition filed by Ahluwalia in the High
Court of Himachal Pradesh was pending, some of the respondents to the Writ
Petition and one R. R. Verma all direct recruits, chose to file a Writ Petition
in the Delhi High Court questioning the notice dated June 29, 1979, calling
upon them to submit representations against the year of allotment proposed to
be allotted to Sahney, Dhaliwal and Ahluwalia. After the Writ Petition of
Ahluwalia was allowed, and after the Central Government passed the order dated
July 27, 1979, pursuant to the direction issued by the High Court of Himachal
Pradesh, the Delhi High Court dismissed the Writ Petition filed by the direct
recruits as infructuous. The High Court, however, granted a certificate of
fitness to appeal to this Court under Article 133 of the Constitution.
Therefore, this appeal. The Writ Petition having been dismissed as infructuous
we do not see how a certificate under Article 133 could have been granted. But,
we do not want to dismiss the appeal on that preliminary ground. Shri R. K.
Garg, learned counsel for the appel- 481 lants challenged the order of the
Central Government dated July 27, 1979 on three grounds: (1) Rule 3 of the All
India Services (Conditions of Service-residuary matters) Rules, offended
Article 14 of the Constitution and was ultra-vires as it conferred arbitrary
and uncanalised power upon the Central Government to grant relaxation whenever
it pleased it to do so. (2) The discretion to relax the rules was wrongly
exercised in the present case. (3) The Central Government was powerless to
review its earlier orders as such a power of review was not expressly conferred
by the rules.

The second question has already been
considered by us in Civil Appeal No. 2112 of 1979 and we have held that this
was a fit case for the exercise of the power of the Central Government to relax
the rules.

The first question is about the
Constitutional validity of rule 3 of the All India Services (Conditions of
Service- residuary matters) Rules 1960. Rule 3 is as follows:

"3. Power to relax rules and regulations
in certain cases-Where the Central Government is satisfied that the operation
of- (i) any rule made or deemed to have been made under the All India Services
Act, 1951 (61 of 1951), or (ii) any regulation made under any such rule,
regulating the conditions of service of persons appointed to an All India
Service causes undue hardship in any particular case, it may, be order,
dispense with or relax the requirements of that rule or regulation, as the case
may be, to such extent and subject to such exceptions and conditions, as it may
consider necessary for dealing with the case in a just and equitable
manner".

The submission of Shri Garg was that the rule
conferred upon the Central Government absolute and arbitrary discretion, a
discretion left entirely to the satisfaction of the Government, Government with
no prescribed objective standards or guidelines. It is true that the rule is
couched in a language suggestive of near-autocratic power reminiscent of
"bad old days" of the Imperial Raj but, we have no doubt that the
rule is not meant to vest the Central Government with power to pass any order
they like with a view to promote the interests 482 of a favoured Civil servant.
It is really meant to relax, in appropriate cases, the relentless rigour of a
mechanical application of the rules, so that civil servants may not be
subjected to undue and undeserved hardship. Sufficient guidance can be had from
the very rule and from the scheme of the various statutory provisions dealing
with the conditions of service of Members of the All India Service.

Section 3 of the All India Services Act
enables the Central Government in consultation with the Governments of the
States concerned to make rules for the regulation of recruitment, and the
conditions of service of persons appointed to an All India Service. Pursuant to
the power given by Section 3 of the All India Services Act the Central
Government has made innumerable sets of rules, some common to all the All India
Services and some applicable separately to each of the All India Services. The
All India Services (Leave) Rules, the All India Services (Conduct) Rules, the
All India Services (Discipline and Appeal) Rules, the All India Services (Travelling
Allowance) Rules, and the All India Services (Conditions of Service-residuary
matters) Rules are examples of rules made under Section 3 of the All India
Services Act which are common to all the All India Services. The Indian Police
Service (Cadre) Rules, the Indian Police Service (Recruitment) Rules, the
Indian Police Service (Probation) Rules, the Indian Police Service (Regulation
of Seniority) Rule are examples of rules made under section 3 of the All India
Services Act applicable to a single All India Service namely, the Indian Police
Service. The rules, as may be seen, deal with countless matters which concern a
civil servant, such as creation of cadres, fixation of Cadre Strength,
recruitment, seniority, promotion, leave, allowances, conduct, discipline and
appeal, and a host of such other matters. The golden thread, if we may so call
it, which runs through the entire complex fabric of rules is the securing of
honest and competent civil servants. Integrity and efficiency are the hall
marks of any civil service anywhere and they are what are contemplated and
aimed at by the wide range of rules. The interest to be served is always the
public interest and not individual interest. Public interest, in the matter of
the conditions of service of civil servants, is best served by rules which are
directed towards efficiency and integrity.

Now, very wide as the range covered by the
rules is, the rules can never be exhaustive. Unforeseen and complex situations
often arise as will be obvious even from a bare perusal of the cases reported
in the Law Journals arising out of "service controversies". Very
often it is found that an all too strict application of a rule works undue
hardship on a civil servant, resulting in injustice and inequity, causing disappointment
and frustration to the civil 483 servant and finally leading to the defeat of
the very object aimed at by the rules namely efficiency and integrity of civil
servants. Hence it is that the Central Government is vested with a reserve
power under rule 3 to deal with unforeseen and unpredictable situations, and to
relieve the civil servants from the infliction of undue hardship and to do
justice and equity. It does not mean that the Central Government is free to do
what they like, regardless of right or wrong; nor does it mean that the Courts
are powerless to correct them. The Central Government is bound to exercise the
power in the public interest with a view to secure civil servants of efficiency
and integrity, and when and only when undue hardship is caused by the
application of the rules, the power to relax is to be exercised in a just and
equitable manner but, again, only to the extent necessary for so dealing with
the case. We do not have to add that the exercise of the power of relaxation
like all other administrative action affecting rights of parties is subject to
judicial review on grounds now well known. Viewed in this light we do not think
that Rule 3 is unconstitutional on the ground that it vests an unfettered
discretion in the Government.

The last point raised by Shri Garg was that
the Central Government had no power to review its earlier orders as the rules
do not vest the Government with any such power. Shri Garg relied on certain
decisions of this Court in support of his submission : Patel Narshi Thakershi
& Ors. v. Pradvamunsinghji Arjunsinghji, D. N. Roy and S. K. Bannerjee
& Ors. v. State of Bihar & Ors., and State of Assam & Anr. v. J. N.
Roy Biswas. All the cases cited by Shri Garg are cases where the Government was
exercising quasi judicial powers vested in them by statute. We do not think
that the principle that the power to review must be conferred by statute either
specifically or by necessary implication is applicable to decisions purely of
an administrative nature.

To extend the principle to pure
administrative decisions would indeed lead to untoward and startling results.
Surely, any Government must be free to alter policy or its decision in
administrative matters. If they are to carry on its their daily administration
they cannot be hide-bound by the rules and restrictions of judicial procedure
though of course they are bound to obey all statutory requirements and also
observe the principles of natural justice where rights of parties may be
affected. Here again, we emphasise that if administrative decisions are
reviewed, the decisions 484 taken after review are subject to judicial review
on all grounds on which an administrative decision may be questioned in a
Court. We see no force in this submission of the learned counsel. The appeal
is, therefore, dismissed.